Bitcasa gets an early start on IP acquisition

If you haven’t yet heard of Bitcasa, you probably soon will. Bitcasa provides limitless cloud storage for only $10 per month and has received $1.3 million in investment from such heavyweights as Andreeson Horowitz, First Round Capital and Pelion Venture Partners. The company is currently a TechCrunch Disrupt finalist.

What’s most interesting about Bitcasa is that, as the name implies, the technology deals in the individual bits underlying a file (the 0’s and 1’s) and doesn’t know or care about the files themselves. So with Bitcasa no one knows the file names, the authors or any of the metadata typically associated with storing a file. On top of all that, your limitless amounts of data are stored across hundreds or thousands of drives in the cloud, thereby providing redundancy. So how does Bitcasa offer all that for only $10 per month?

Bitcasa argues that while they offer an unlimited amount of storage, most users only have about 25 gigabytes of unique data and the rest is largely duplicate data that does not need to be stored and Bitcasa’s de-duplication technology allows for identifying this data. At TechCrunch Disrupt, Bitcasa’s founders claimed that their “special sauce” is in their 20 patents. However, it is likely that they misspoke.

A search of the US Patent And Trademark Office issued patents and published applications databases revealed no patents or published applications assigned to Bitcasa nor are any of the three founders, CEO Tony Gauda, Joel Andren and Kevin Blackham, listed as inventors on any patents. While of course it is possible that the patents have different inventors or are assigned to a different entity and that is why they cannot be easily located, since Bitcasa is an 8 month old company, a portfolio of twenty patents would likely have been a result of an acquisition of another company or a patent purchase. Thus, it is more likely that Bitcasa has filed 20 patent applications to date and they have not yet been published.

this young to have so many patent application filings. There is a significant cost involved in filing even a single non-provisional patent application, especially in the computer arts. Thus, it is clear that the founders believe their technology to truly be revolutionary to make such an investment in their Intellectual Property portfolio.Unfortunately, patent applications are not accessible to the public prior to the 18 month publication date so we cannot review the actual “secret sauce” of the company. Still, it is impressive and rare for a company

The cloud storage space includes such heavyweight competitors as Microsoft, Apple, Amazon and Dropbox. Bitcasa aims to challenge these cloud services providers, as well as the old guard led by Western Digital. By not waiting to begin building their patent portfolio, Bitcasa will gain a competitive advantage in both keeping their competitors from infringing on their IP rights, as well as allowing Bitcasa to defend itself against offensive strikes by the larger competitors, each of whom hold vast numbers of patents. Once the patent applications issue, it will be interesting to see how Bitcasa’s counsel has chosen to structure their patent filings. Of course, the patent applications will also make Bitcasa an obvious acquisition target in the never-ending IP war between Microsoft, Apple and Google.

While Bitcasa does not currently have any issued patents, it does have a registered Trademark for the company name. The Trademark is a standard character mark. The mark was registered in both classes 9 and 42 and unsurprisingly, the description of goods is focused on “cloud computer services” in class 9 and “computer services” in class 42.

Finally, based on a search of the copyright office, Bitcasa appears to not have registered any copyrights to date.

In all, for a company that is only 8 months old and with a relatively modest investment of 1.3 million dollars, it is clear that the founders have emphasized development of a strong IP portfolio. It appears likely that a large portion of the investment in the company was used to pay for patent services and I believe this signals the founders’ strong belief that their technology is indeed revolutionary. It will be interesting to see whether this head start on IP acquisition will be money well spent in the long run.

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About Me

Leonid (“Lenny”) Kravets is an IP attorney focusing on corporate development and strategy at Interdigital, Inc. Lenny’s primary responsibilities include evaluation and analysis of strategic acquisition opportunities, with a particular focus on patents.

Mr. Kravets is a contributor of IP articles to TechCrunch, a popular technology blog. He has been quoted in publications such as Time, Forbes, INC and BBC, and has appeared on the Huffington Post Live to discuss the state of the patent system.Read more…

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